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Muthoot net drops 6% on provisioning

Gold loan company Muthoot Finance reported a 6% fall in net profit in the fourth quarter at R220 crore.

Gold loan company Muthoot Finance reported a 6% fall in net profit in the fourth quarter at R220 crore. The company attributed lower net profit on higher provisions for tax and voluntary increase in standard asset provisioning. However, net profit for the fiscal rose 13% to touch R1,004 crore compared with R892 crore in FY12.

The company said it performed well despite adverse conditions, including regulatory restrictions imposed on gold loan NBFCs by RBI and a fall in gold prices. The company plans to open 300 new branches in the current fiscal and expects a 20-30% growth in loan portfolio. Total income for the last quarter rose by 9% to R1,411 crore against R1,294 crore in the same quarter of FY12. Total income for FY13 stood at R5,387 crore compared with R4,549 crore in FY12, a growth of 18%. The company is offering an enhanced dividend of R4.50 to shareholders.

Chairman MG George Muthoot said, ?While gold price is a relevant factor for the gold loan business, it need not have a direct correlation to the collection behaviour.?

Total AUM at the close of the last fiscal stands at R26,000 crore as against R24,417 crore at the close of FY12. Credit loss rose 88% in the fiscal to touch R13.03 crore.

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First published on: 15-05-2013 at 02:26 IST
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